Top 5 Advisor Excuses for Avoiding Social Media
Why some financial advisors still reject a proven marketing tool
If there is one thing we encounter over and over at FMG Suite, it’s a financial advisor’s too-strong-for-reason resistance to try out social media. Despite the following data from an Accenture study, about half of financial advisors are still not actively embracing social media. The study shows that advisors who do use social media enjoy faster and easier communication with clients, increased referral sources and higher client retention.
According to the Accenture study of financial advisors who use social media:
- 74% agree that social media helps them increase assets under management
- 40% indicate they have gotten new clients through Facebook
- 25% have developed new clients through LinkedIn
- 21% have earned new clients through Twitter
A social media presence has been proven to be an important piece of an effective marketing puzzle, yet so many advisors are reluctant to take the plunge. Why is there still such a strong opposition? Here are our top theories for why almost half of advisors are still not tweeting, posting and liking their way to new business:
1. They Don’t Get It
The digital age has changed our lives at an alarming rate and those of us who don’t consider ourselves “tech savvy” have had a hard time keeping up. Social media and its terminology can be confusing, overwhelming and downright annoying. But the concepts behind the language are very simple. LinkedIn is a place to connect with professionals. Twitter is a place to share content. Facebook is a place to connect with friends. YouTube is a place to share videos.
If advisors don’t “get” social media, the best way for them to understand is to try it out by spending some time on the most popular sites. There is a good reason social media websites dominate traffic on the Internet; they’re fun and interesting to use. Enlisting a tech savvy spouse, child or friend to explain the basics and help set up an account goes a long way. Then, they should take some time to explore at their own pace to find out what all the hype is about.
2. Compliance Fears
The most common explanation (or excuse) we hear from advisors is that compliance regulations keep them from joining social media. Sure, compliance can be a burden, but the same rules apply whether you are writing a letter to clients, creating collateral for a seminar, or posting to social media. You must follow basic guidelines and avoid promissory statements. Broker-dealer firms have come a long way in recent years to support advisors use of social media and have made the process easier than ever. All major broker-dealers have procedures in place to efficiently capture, monitor and assist their advisors’ social media efforts.
The trick is to understand that the nature of social media marketing is not to make specific recommendations, but to offer general information, entertaining articles and videos and to connect with clients on a personal level. Compliance will not stand in the way of using social media to achieve these results.
3. No Instant Gratification
We all love instant gratification. That’s why we gamble even though we know we’re likely placing a losing bet and eat that second scoop of ice cream. It’s tough to stick to a plan that doesn’t pay off right away. But as the latin phrase “gutta cavat lapidem” or “a water drop hollows a stone” describes, progress is sometimes made not by force but by small actions repeated often.
Social media pays off at its own pace, but when it does, it tends to be significant. Take it from a San Diego advisor who had been using social media for 6 months with no results, until a college sorority sister Facebook messaged her that she had just inherited $2 million from her grandmother. The payoff might be delayed and unpredictable, but advisors can’t afford to miss out.
4. They Think it Takes Too Much Time
Having a polished, professional and engaging social media presence does take some time. But the truth is that your social media efforts can and should coincide with the work you put into being a great advisor. All good advisors read interesting articles, watch educational videos and come across compelling data. Take a few extra moments to share this information with your network and you’ve got a great social media presence.
Advisors who leverage social media know that the content stream is a two-way street and use their accounts to find relevant information and articles that they can use in their practice. They share this content, in addition to their own writing, with their networks and schedule posts in a way they helps them stay in the forefront of clients’ minds. Whether they come across a new tax law, an interesting data point, or a local charity golf tournament, clients appreciate when advisors share valuable information with them. It pays off to invest a few extra minutes to post content advisors already consume and to engage clients and prospects in a whole new way.
5. The Cost
To be fair, there are often monetary costs associated with social media and the compliance mechanisms to track them. These costs are relatively small and generally decreasing, as broker-dealers continue to recognize the importance of social media marketing for advisors. It’s important to look at these costs as a fraction of your total marketing budget, similar to the postage for a direct mail campaign. If you get one new client or 10 good ideas from the endeavor, those costs have paid for themselves. Advisors should envision the price as an investment in future business and let that be a motivator to regularly use social media accounts.
Do you know advisors who are still hesitant to get started? Social media accounts only take a few minutes to set up and less than 10 minutes a day to keep current. Missing a day or two is no big deal. As long as advisors have an account and post every once in a while, it counts as “being on social media.” Encourage them to give it a few months, keep sharing interesting content and be patient; a water drop hollows a stone.